The limitation does not apply to interest (h).

In an action to limit their liability the plaintiffs paid into court the amount of their statutory liability at the rate of £15 per ton, the amount so paid in was insufficient to satisfy in full the claims against them in respect of loss of life and loss of goods, and the claimants in respect of loss of life were held to be entitled to be paid out of the money in court an amount equal to £7 per ton, and that they and the claimants in respect of loss of goods must rank pari passu against the balance of £8 per ton (¿).

BOTTOMRY.

Bottomry is a contract by which in consideration of money advanced for the necessities of a ship, to enable her to proceed on her voyage, the keel or bottom, pars pro toto is made liable for the repayment of the money in the event of the safe arrival of the ship at its destination. Not only the ship but the freight and cargo may be the subject of hypothecation. When the cargo alone is

hypothecated it is termed respondentia (j).

In all cases it is on the necessity of obtaining what is absolutely required for the ship or cargo that the contract is based. It is necessity alone that supports bottomry bonds, the absence of necessity is their undoing (k).

Any shipmaster in a foreign country, is, for some purposes, the agent of the owners and for some purposes the agent of the freighters. The agency spoken of is devolved upon him by the law of his flag. The same law that confers this authority ascertains its limits; and the flag at the mast head is notice to all the world of the extent of such power to bind the owners or the freighters by such acts ().

(h) The Amalia, supra.

(i) The Victoria, 13 P. D. 125.

(j) Wms & B. 43.

(k) The Nelson, 1 Hagg. 169, 175; The Prince of Saxe Cobourg, 3 Moo. P. C. 1.

(1) Maclachlan's Mer. Shipping, 4th Ed., 174-5.

Where the master of a French ship carrying an English cargo to Liverpool hypothecated ship, freight and cargo at a port of distress, it was held that he was justified in doing so by the law of his flag, and that the English merchant in making the charter, impliedly consented to be bound by that law (m).

In addition to the names of the parties, and the amount of the loan and interest the contract or bond contains, the name of the ship, and the voyage during which the risk is to be incurred (n).

It must be clearly expressed that the loan is only to be repaid in the event of the successful termination of the voyage, (o) not if she is lost on the voyage by the perils of the sea, and that the vessel is hypothecated. The occasion of the loan ought also to be expressed, although it is not necessary that the court should gather this from the instrument (p).

The court will not in a well founded claim enter into a minute criticism of the language of the bond (q).

If personal security is available the bond is invalid (r)

The master must in every case when it is reasonably practicable, communicate with the owners before borrowing, and should inform them that hypothecation is contemplated (s).

And a separate communication to the owners of the cargo, when practicable is absolutely necessary (t); and that although by the law of the country to which the ship belongs such communication is unnecessary. In an action where the defendants pleaded that the master might have communicated with them the owners before hypothecating the cargo, the plaintiff replied that the ship was an Italian (m) Maclachlan's Mer. Shipping, 4th Ed., 174, 175.

(n) Western v. Wildey, Skinner, 152; The Jane, 1 Dods. 461.

(0) The Nelson, 1 Hagg. 169; The Emancipation, 1. W. Rob. 124; The

Royal Arch, Sw. 281.

(p) Wms. & B. 59.

(9) The Alexander, 1 Dods. 280.

(r) The Hero, 2 Dods. 139.

(s) The Oriental, 7 Moo. P. C. 398, but see The Bonaparte, 8 Moo. P.C. 488. (t) The Hamburg, 2 Moo. P. C. N. S. 289.

ship, and that by the law of Italy such communication was unnecessary. The reply was on demurrer held bad (u).

Foreign Law. The question by what law the validity of the transaction should be determined in cases where the bond is granted by the master of a foreign ship in this country, or abroad, or by the master of a British ship abroad, has given rise to much discussion. And although it appears now to be settled that purely maritime contracts are in many respects to be regulated by the law of the flag, it by no means follows that the Admiralty Court is bound to lend its process to enforce a bond in a case where there is an absence of proof of the validity of the bond such as is required by the law of England. Until the decision of the Court of Appeal in the case last referred to, there was no case in which Admiralty process in England had been allowed to be used to give effect to a bond not valid according to the law maritime as administered in this country, and in many cases the court had declared its unwillingness to interfere to enforce the rules of foreign law which conflict with the principles of jurisprudence recognized in England (v).

Lien, and Priorities.-The lien of a bottomry bond holder ranks after liens for damages, wages, and subsequent salvage, subsequent towage, and subsequent pilotage. But where the damage has been done before the bond was given, and the holder of the bond is a stranger who has in good faith advanced money for repairs, it seems that he has a lien to the extent of the increased value of the vessel arising from the repairs, which is entitled to precedence of the claim for damages. Wages earned on the same voyage on which the bond is given, whether before or after the giving of the bond are to be preferred to the bond. But a master who has given a bottomry bond, binding himself, ship, and freight, cannot claim wages, to the prejudice of the bondholder. But this rule is not to be pushed beyond the exigency of the case. Where a suit is instituted by a bondholder, and seamen make a claim against the ship for (u) The Gaetano and Maria, 7 P. D. 1.

(2) Wms. & B. 60.

wages which he does not dispute, if the bondholder wishes to save the expense of a separate suit for wages, the proper course for him to adopt is to apply to the court to sanction the immediate payment of the wages to the seamen by him, then the court will afterwards order the repayment of the amount so paid by him out of the proceeds. But if the bondholder pays the wages without the sanction of the court he does so at his own peril. The claim of a bondholder takes precedence of a possessory lien for necessaries afterwards acquired by a shipwright, and a claim for necessaries supplied before the bond, even though the claim for necessaries may have been pronounced for before the bond is put in suit. It also takes precedence of the claim of a mortgagee, and the bondholder is under no obligation to communicate the existence of the bond to the mortgagee, nor is his claim affected by the owner of the ship concealing the existence of the bond from the mortgagee (w).

In the case of a respondentia bond, where the cargo is transhipped after the bond is given, and the subsequent carrying on of the cargo is essential to make it available for the holder of the bond or anybody else, the freight payable for carrying on the cargo will be regarded as in the nature of salvage, and the lien of the master of the ship which has carried on the cargo, for such freight will take precedence of the claim of the bondholder. So under

similar circumstances where a loss has been incurred for the general benefit of the ship and cargo, so long as the master retains his lien for general average, the claim of the bondholder will be treated as subject to the claim on the cargo for general average (x).

Where several bonds have been given on the same voyage, that which is last in point of date must be first paid, since without the subsidiary aid of the later bond the property would be totally lost, both to the owners and the former bondholders. A valid bottomry bond gives the holder a maritime lien on the subject hypothecated. Like (20) Wms. & B, 64.

(c) Ibid. 65

other maritime liens this can only be enforced by proceedings in Admiralty in an action in rem. Should the master seek to render the owners personally liable by the terms of the bond, the court will refuse to give effect to that portion of the instrument. It seems, however, that the master may render himself personally liable on the bond (y).

A bottomry bond given upon the ship, freight and cargo must be enforced against the ship and freight before it can be enforced against the cargo (z).

A premium or high rate of interest is usual on bottomry or respondentia bonds, and the absence or presence of the premium and the rate of interest are considered in determining whether bottomry was intended or not (a).

The court has power to reduce the amount payable under a respondentia bond (b).

If a bond be declared invalid by the Admiralty Division (Eng.), no other court has power to enforce the claim, and the lender loses his money altogether (c).

FORMS FOR BOTTOMRY AND RESPONDENTIA (d).

BOTTOMRY BOND ON SHIP AND FREIGHT.

KNOW all men by these presents, that I, A. B., master of the ship Albany, of London, am held and firmly bound unto C. D., of Bombay, merchant, in the sum of lawful British money, to be paid to the said C. D., or his certain attorney, executors, administrators, or assigns, for which payment well and truly to be made, I bind myself, my heirs, executors, and administrators, and also the said ship, her tackle, apparel, and furniture, and the freight to be (y) Wms. & B. 60.

(2) The Bonaparte, 3 W. Rob. 202.

(a) The Emancipation, 1 W. Rob. 127.

(b) The Pontida, 9 P. D. 103, 177.

(e) Stainbank v. Shepherd, 13 C. B. 418; Smith's Ad. Pr. 4th Ed., 99.

(d) Maclachlan on Shipping, 4th Ed., 991; Abbott, 13th Ed., 1245.